Member Info for Sotolo

Always been interested to see what miners do in tumbling market If gold falls they tumble? If gold stays flat and holds value as it should, they fall as market rerates and expects lower pe’s across the board plus investors need cash? If gold rises a bit as investors move to it miners stay flat as markets rerate If gold soars they rise? Depends a lot whether markets fall as so often because real rates rise which hits gold, or this time with much growth around the world so strong fall because of worry and weakness as on trade war. Also a lot on whether oil comes back or costs continue to soar. Only some thoughts Wish I’d got off after the profit warning Horrid seeing daily erosion And no end in sight....

Yes Wise words as ever, I watch my gold charts in euros and pounds. Sadly gold in sterling is down £100 in last 2 years, and of course costs in sterling are up considerably, hence fairish price imho

But cey can weather a fall much better and longer than many rivals, as long as it remains low cost. Some like OMI are already collapsing and when gold furns up will be too late. However the share price can wobble all over the place in the meantime: I remember buying cey when gold price was a couple of hundred dollars lower but costs were lower and profits around where they are now, pre profit share and price was around 50p. Of course like all I hope gold turns up, and oil proce falls, just on balance of current world economic prospects down seems likelier, but who knows......it catches one out.

I still think cey is the best gold miner to be in, priced about right and with no debt and good cash flow so better placed to see out a falling gold price if that is what we get. But each Monday I wake up in gloom as the markets open again and the fall continues, at least we get the weekends off. We have lost 40% from the top, amd most miners seem down around a third so far as costs rise and gold doesnt, with their falling prices predicting further falls. For me now hinges on whether worry about inflation beats worry about rising rates and qe reversal. Qe was always going to be a dividend for us, no one knows quite how bad it will be when taken away, but so far gold is saying not great and I fear future Mondays

That’s a relief Siko. And means we know longer need to worry about the diesel case! But world oil price has doubled and oil is a large proportion of costs so still keen to know how it has affected CEY as presumably added maybe 20% to costs, partly hence increased pressure on miners who now need $1400 gold to be where they were in profitability with $1300 gold? Thanks so much as ever Siko. How do you see production, costs and profits going? You always seem so wise as well as decent.

Thanks as ever Mr Tibbs. This is the article on 50% diesel rise at pumps. https://gulfnews.com/news/mena/egypt/egypt-hikes-fuel-prices-1.2237582 Would that add 10% to aisc and is that on top of rise we were told of? Expect my claculations are potty. I usually am All best Sotolo

I read that the price of diesel was increase 50% last week in Egypt though I dont know if Cey pay open market prices. So Tibbs just womdering did you ever get an answer to my big question before your chat to the investment relations person on how much it is lower production and how much mining inflation that is dramtically increasing CEY AISC On the back of a fag packet I reckon oil usually accounts for something like 15% of gold miners’ direct costs, and over 20% if you take cost of oil in making the hugely expensive tires lime etc so say 20% for v rough ballpark. Then in last 2 years in Egyptian pounds international oil price is up four fold. If we say calculate in sterling where we count our profit, it has still doubled which would mean, if my small head has it right an increase of maybe 20% in costs, so would need price of gold at least $1400 to have profits we had. Hence price of cey down 40% from peak? Does anyone else think costs are the problem and why miners tumbling as gold in sterling euro etc terms pootling along or have I got it completely wrong and should we all be focussing only on what they sell their gold for, ie what gold price is doing which is not huge in basket of currencies (yet) and a bit of a fall or increase in production?

Sadly as thought on the day of the production warning I continue to think this could come down a bit under than a pound if it mimics other miners warnings, hopefully it will then come back up a little and settle not too much below here. However now most unfortunately, on top of the Cey production fall, gold has finally broken out of its range and down rather than up, as seemed more likely under the headwind of rising interest rates, so now who know what will happen. It is very worrying, a double whammy for us, but also as said before I am hoping there will just be one big gold price fall to frighten holders out before onwards and upwards. The current economic headwinds of rising interest rates, and booming US seem to be too strong for gold just now, plus the Korean talks and end of QE. I will feel optimistic again when all say gold is doomed and can never rise again. But of course Uncertain as you know my gloom can presage a rise. It is all very sad for us.

Gosh Tiger what a brilliant post, most thought provoking and intelligent. Thank you so much, I concur with all you say but you have stretched my thoughts further. It is both why I continue to hold Centamin and why Centamin isn’t doing better. My holding is now down to 15% of my portfolio having been more as I worry more about the future.

No never expected such a fall with gold at these prices , but then never expected a warning with such a large drop in profits. Companies” shares really pay for that. Interesting that other miners have also been falling, though not so much, presaging falling metals or rising cost or both, with analysts marking down profits But then gold is rising a bit only in dollars, in real terms a bit mouldy and being beaten by mining inflation. Here’s hoping silver that has moved above its 200 day average can get precious metals making some real, as supposed to dollar, gains

Thanks Marmot for the comforting words of wisdom. Whenever I am gloomiest sentiment seems about to turn, but that is the nature of markets. So oddly all the optimism on the board makes me mildly pessimistic.

Uncertain you’re memory is of course perfect, a couple of times I have been frightened out of some and then bought the same back, sometimes for slightly less sometimes slightly more but overall pretty much breaking even, which is why I don’t bother any more as whenever I am frightened out I immediately miss them and usually calls a bottom ! So now I just sell and buy back at divi time for the Cgt. However I wish I had been able to sell some at 136 the morning of the RNS but just couldn’t trade and by the time it was 130 I didn’t bother, but actually added at 126 so have too many but am sanguine longer term. I hope all else is going as well for you as your memory.

Uncertain you’re memory is of course perfect, a couple of times I have been frightened out of some and then bought the same back, sometimes for slightly less sometimes slightly more but overall pretty much breaking even, which is why I don’t bother any more as whenever I am frightened out I immediately miss them and usually calls a bottom ! So now I just sell and buy back at divi time for the Cgt. However I wish I had been able to sell some at 136 the morning of the RNS but just couldn’t trade and by the time it was 130 I didn’t bother, but actually added at 126 so have too many but am sanguine longer term. I hope all else is going as well for you as your memory.

Yes indeed Uncertain, but I also notice that other miners, whose output is not falling, seem to be facing significantly rising costs, though of course not as bad as Centamin's, which makes me wonder if some of the rising CEY aisc is due to rising oil prices, exploration costs and other mining inflation, which isn't a one off hit. Interesting how much companies like Hoc and Fres got bashed last week and why the downgrades.

Me too, any mine has problems. Like you I am a long term holder and very grateful to the management. However I would still like to know how much the increased aisc is a result of the problems. In the absence of Tibbs getting an answer to the question from investor relations I hope that, at the next quarterly results, the board's prediction will be that we will get back to the pre output cut aisc, or near it, if so the price of Cey should be good in a year or 18 months if gold price holds. I bravely added a little but still expect it may go lower first, but this price is good for me in the longer term.

Thanks Prof, just so, have too many so worry about downside but find selling so hard as worry about missing out on any eventual soaring. At work I always thought the key was to worry about the downsides, and this is also the big thing in avoiding tragic market losses. Sadly as expected Cey is still falling on the prospect of lower dividend, higher pe this year, but we hope up later in the year or next when news that profits are recovering although aisc will remain partly higher if oil stays up so will need higher production or gold price to rise a bit, and all so gold price dependent which is looking iffy just now. Even so bought a few more with divis this morning as balance sheet so strong and a few years out hoping this will come very good. As prof says as long as gold stays up and court case doesn�t go against us Cey looks good value compared to many miners long term, though downside concerned Iworry about miners high pe�s and rising costs overall, which can only be saved by a considerable gold price rise, which we hope will come after the market tries to rattle us out first. Hold tight it might be scary...

No just being honest and saying what I think. Gosh I hope you are right. Like prof I have getting on falf a million of them and far too high a proportion of my portfolio, and have even gently added last and this week, but not in the expectation of a fast profit as I believe it could go lower. However I am a long term holder not a trader. My view is that at the current gold price, fewer oz mined and higher aisc the price of Cey is about right, after profit share the pe this year will be considerably above the market average . However next year should be better which is why I added. The company has. A good balance sheet and management to ride out rough patches. However so much depends on whether weak gold in dollars falls further. I do so hope you are right, short term I fear you may not be.

But not after they had issued a surprise and rather dramatic profit warning

For me the Cey share price is about right for lowered. expected profit this year given half of it goes to the government, so the real pe is not cheap. So a. YES looking forward now looks a good time to buy if you expect recovery in production next year and hold b. NO if price of gold continues to drift down the share will come under further pressure. My big worry is b. My big hope is a. So a share for the gambler as luck rather than judgement. So personally I would not add to overall gold shareholding now; however if you have other gold shares now might be a good time to switch some to Cey which is what I have done and how added 10% to my holding Finally I have asked board members before to guess where the gold price will be in a month and. A year, I would love to know.

Marmot I agree with everything you say, CEY can't stay undervalued for ever, but nor can I stay alive for ever, It could be a while. Gold has failed to burst 1365 so many times doesn't necessarily mean it will turn up, try again and succeed in breaking 1365, it may just as well tumble with the headwinds of booming US economy amidst rising rates. Any geopolitical event needs to be big enough to make gold more attractive than stocks and shares, often I think most of these are just an excuse to justufy the market doing what it does anyway, So far price of gold seems to have reacted to market entirely logically, hence my short term worry, so my expectation is perhaps a fall that terrifies us and tries to shake us out and then with luck the rise beyond 1365 we have been waiting for, the good thing is CEY could sit this out with its strong balance sheet and low costs but a much lower share price, however I do hope I am wrong and the last fall is this and it is about to soar, and it makes my fortune in next decade or two while still here. Afraid pure speculation, but fun and frightening and keeps us occupied! Thanks for your post!